Three S&P/ASX 200 Index (ASX: XJO) just got rerated by leading brokers.
One had its outlook cut.
The other two received boosted forecasts.
Read on for the details.
(Broker data courtesy of The Australian.)
Image source: Getty Images
One ASX 200 share getting downgraded
First, we turn to the ASX 200 share getting its rating cut today, software designer Altium Ltd (ASX: ALU).
Altium shares are down 0.1% in early trade today, changing hands for $67.48 apiece. That sees the Altium share price up 45% in 2024. The stock also trades on a partly franked trailing dividend yield of 0.9%.
Much of this year's strong performance stems from February's $9.1 billion takeover offer lobbed by Japan's Renesas Electronics Corporation. An offer the board supports and one that's headed for a shareholder vote.
The takeover offer values Altium at $68.50 per share.
That also happens to be Citi's price target for the stock. The broker doesn't appear to see any further upside from there and has cut this ASX 200 share's rating to neutral.
Two large caps getting upgrades
Moving onto the ASX 200 shares earning upgrades, we kick off with iron ore miner Champion Iron Ltd (ASX: CIA).
The Champion Iron share price is up 0.9% in morning trade today at $6.66. But following on this year's slide in iron ore prices, Champion Iron share remain down 22% in 2024. The stock also trades on an unfranked trailing dividend yield of 2.3%.
Macquarie believes that the sell-off has been overdone.
The broker raised Champion Iron to an outperform rating with a $7.90 price target. That represents a potential upside of almost 19% from current levels.
The miner released some promising FY 2024 results on 31 May. Among the highlights, the company achieved all-time high earnings before interest, taxes, depreciation and amortisation (EBITDA) of C$553, an 11% increase from the prior year.
Which brings us to the second ASX 200 share getting a broker upgrade, Aussie oil and gas giant Woodside Energy Group Ltd (ASX: WDS).
The Woodside share price is up 1.4% today, at $27.46 a share. That still leaves the stock down 13% in 2024. And it sees Woodside shares trading at a fully franked trailing yield of 7.9%.
According to Macquarie equities analyst Mark Wiseman, Woodside shares are now trading at bargain levels. Macquarie raised Woodside shares to an outperform rating with a $32.00 price target (unchanged). That represents a potential upside of almost 17% from current levels.
According to Wiseman, Woodside shares have been oversold based on excessive concerns over the company's project and climate risks.
On the project risk front, yesterday the ASX 200 share reported it had achieved its first oil from the offshore Sangomar project in Senegal. Sangomar is one of the company's major growth projects that's come under scrutiny following government elections in the African nation in March.
According to Wiseman (quoted by The Australian):
We see upside potential from the ramp-up of the Sangomar project, ability to book additional reserves. In 12 to 24 months Woodside can determine whether a phase 2 project is viable.
